During the past few days, some analysts believed there would be a bubble in the real estate markets in Bangkok. However, Dr.Sopon confirmed there would be none but a bust awaiting in the near future.

Dr.Sopon Pornchokchai, President of the Agency for Real Estate Affairs which is the largest and most independent real estate information and valuation centre in Thailand since 1994 disclosed his survey on the latest launching of real estate projects in Bangkok during the first four months of 2015.

During the first four months of 2015, considering housing or owner-occupied residence alone, there were 30,501 units launched with a total value of Bah 130.938 billion. This seemed to be a big increase. If we simply multiplied these figures by three to make the whole year estimate, it was estimated that the total units launched in 2015 would be 91,503 units with a total value of Baht 392.814 billion. This value would even be higher than the launched value of Baht 344.549 billion in 2014; whereas, the total units launched in 2014 was slightly higher at 114,229 units.

This was an extraordinary phenomenon. In details, Dr.Sopon found that during this first four months, there were 1,163 units of housing (including owner-occupied apartment or condominiums and luxury detached houses) priced over Baht 20 million per unit. This constitutes only 3.8% of the supplies. However, in terms, of value, it was as high as Baht 43.824 billion or 33.4% of the total value launched. This might be a myth for people to misunderstand that there would be a bubble.

However, if those units over Baht 20 million were not considered, the total units launched during the first four months of 2015 would be 29,338 units with a total value of Baht 87.114 billion. If we simply multiply by three to estimate the total supplies in 2015, it would be 88,014 units at Bahtg 261.342 billion. If we compared with the situation in 2014, we would found that the supplies would be down for 22.6% in terms of value and 21.3% in terms of units respectively.

Considering condominiums or owner-occupied apartments with the prices below Baht 20 million, it was estimated that the supplies would be 53,268 units in 2015 compared to 64,961 units in 2014. The value would be Baht 136.2 billion in 2015. This implied that the supplies of the condominiums below Baht 20 million per units would be down for 18.1% in terms of value and 16.9% in terms of units.

Therefore, there would not be any bubble in 2015. On the contrary, there would be a bust due to the sudden drop of the supplies in 2015. This would be very much concern for developers, financiers, government officers and planners for the shrinkage of the markets and the economy of Thailand at large.